Former jailed CFO of HealthSouth to give Ethics Day lecture Sept. 21


Aaron Beam, former chief financial officer of HealthSouth, will give the annual Ethics Day Lecture for the UNL College of Business Administration Sept. 21.

The lecture is 3:30-4:30 p.m. in the Lied Center for Performing Arts. It is free and open to the public.

Beam will explain how he and Richard Scrushy founded HealthSouth and developed it into a NYSE Fortune 500 company. It ended badly when fraud began in 1996. His talk will describe the corporate culture that allowed the fraud to continue for seven years. Aaron Beam will also discuss how to spot the signs of ethical collapse in any company.

"HealthSouth was a very viable company," Beam said. "Our earnings projection was just shy of what Wall Street was expecting -- we were 90 to 95 percent there. When it got to the point that we couldn't legitimately make our numbers, the CEO (Scrushy) convinced us to fudge that 5 to 10 percent so we would make our numbers -- he made us believe that we'd make it up in the next quarter. The correct thing to do was to say no to him, stand up to him, but I didn't. Obviously, I was weak of character."

Beam resigned from the company in 1997. The fraud continued until 2003, when it was made public by one of Beam's successors. He and the other four CFOs testified against Scrushy when the case when to trial in 2005. In the meantime, Beam pleaded guilty to bank fraud and served three months in federal prison.

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